Friday, December 27, 2013

Cooking gas price to go up by around Rs 400 per cylinder

The cooking gas price is going to increase by Rs 400 per cylinder
– to Rs 1,870from current Rs 1,470 –
from January, according to the Nepal Oil Corporation (NOC).

After jacking up the price too, the state oil monopoly will incur
a loss of around Rs 1,000 per cylinder, according to the current international
market price, it said.

The corporation said that it is incurring Rs 755.38 loss in a cylinder
of LPG – popularly known as cooking gas – currently, when it is selling at Rs
1,470, also due to appreciating US dollar in recent months. "The LPG is
more consumed in winter season and more import means more loss to the
NOC," it added.

"The recent rise in Saudi Arabian Contract Price (CP) – that
controls the majority of petroleum market globally – and rise in US dollar hit
the corporation," the state oil monopoly said, adding that it has no
option than to adjust the cooking gas price upward.

Though, the government had planned to separate cooking gas
cylinder – blue for commercial and red for domestic purpose – the NOC has not
been able to implement it, which has also made it difficult to adjust the price.

Due to failure in forming much talked auto-price mechanism, Price
Stabilisation Fund, increased red-tape in the technically insolvent corporation
and mismanagement, the NOC is incurring Rs 1.35 billion per month, as it is
incurring Rs 11.09 per litre loss also in diesel, apart from cooking gas,
though it is making Rs 5.16 per litre profit in petrol, Rs 6.03 per litre
profit in kerosene and Rs 28.42 per litre in duty paid (domestic) and Rs 31.57
per litre in bonded (international) Air Turbine Fuel (ATF).

The government had lent it
Rs 12.64 billion and the total outstanding loan of the NOC stands at Rs 33.66
billion. It pays Rs 225.70 million monthly interest for its total outstanding
loan.